The liberalization of air services: prospects and challenges for the Indian economy

Abstract

Purpose

The purpose of this paper is to examine, with a specific reference to the Indian economy, the interface between the World Trade Organization (WTO)/General Agreement on Trade in Services (GATS) disciplines and aviation services; the challenges to the incorporation of air services regimes into the world trade treaty; and the alternative routes for the liberalization of air services markets.

Design/methodology/approach

The paper adopts the doctrinal approach to legal research in analyzing literature on the integration of air services into the multi-lateral trading system. The paper takes a critical look at the current state of the aviation industry, the rationales and routes for liberalization, as well as the challenges facing it.

Findings

The paper reveals the state of the Indian aviation market and its preparedness for integration into the global market system. The merit of a gradual approach is examined.

Research limitations/implications

The WTO framework offers the traditional route for the liberalization of trade. However, since the inception of air travel, air traffic rights have been traded between countries on a bilateral basis, involving concepts of sovereignty over national airspace. The paper offers some ideas on how the two can be integrated.

Originality/value

The research draws on recent events in the Indian aviation sector. It is of importance, especially to other emerging economies with similar social-economic indicators. It objectively questions the rationales for liberalization or globalization and its merits.

Citation

Amana, A.R. (2015), "The liberalization of air services: prospects and challenges for the Indian economy", Journal of International Trade Law and Policy, Vol. 14 No. 1, pp. 49-66. https://doi.org/10.1108/JITLP-04-2014-0007